Peter Hannam and Tom Arup

Lord Nicholas Stern, author of a landmark 2006 study on climate change, says his conclusion that global output could dive 5-20 per cent without action to curb greenhouse gases was an underestimate.

To reduce the risk of severe economic dislocations from rapid global warming, including the potential for forced migration of millions of people, governments will need to embrace a technological revolution, Lord Stern said in an interview.

“Emissions have been increasing faster than we anticipated then, and some of the effects are coming through faster than we thought,” said Lord Stern, citing shrinking Arctic ice and rapid acidification of the oceans as two such changes under way.

While praising recent reports by the Intergovernmental Panel on Climate Change (IPCC), Lord Stern said models underplay risks – and likely costs – by excluding so-called tipping-point events such as the release of enormous amounts of the potent greenhouse gas methane if Arctic permafrost melts.

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“These are not formally in most of the climate scientific models,” Lord Stern said.

His comments come days ahead of the release of an IPCC report examining the prospects and costs for curbing emissions. Two earlier reports in the series – part of the IPCC’s Fifth Assessment - looked at the science and impacts of climate change.

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New climate economy

Lord Stern said his Stern Review for the UK government will have “a big slice” updated later this year with the release at the United Nations of a report on the New Climate Economy assessing how new technologies can shift nations to a low-carbon path.

Madridejos, Spain. Solar PV prices are down 80 per cent in the past few years. Photo: Bloomberg

That report, for release ahead of the UN General Assembly in September, will aim at getting nations “to start to get concrete about the kinds of commitments that will be necessary” for a treaty at the Paris climate summit in 2015, he said.

An embrace of renewable energy, efficiency measures and other technologies could produce a growth path “cleaner, quieter, safer, more community-based, and more bio-diverse” than the current one, Lord Stern said.

According to an IPCC draft obtained by Fairfax Media, the report will say annual investment flows for the 2010-29 period must tilt sharply if global warming is to stabilise at moderate levels.

Investments in fossil-fuel use, such as in coal-fired power plants, will need to drop by $US30 billion ($32 billion) a year compared with baseline scenarios.

By contrast, investment in renewable, nuclear and other low-carbon energy must rise by $US147 billion a year.

Australia falters

Australia’s clean energy industry, though, says plans for a doubling of its current $18 billion investments are in doubt if the Abbott government’s review of the Renewable Energy Target weakens existing goals.

“All of those projects were built and financed on the basis that the current scheme and current target running out to 2030,” said Kane Thornton, deputy chief executive of the Clean Energy Council, an industry group. “Any change of that target will fundamentally impact the viability [of future projects] and impair the value” of existing ones, he said.

A spokesman for Environment Minister Greg Hunt, though, said the review – led by climate change sceptic Dick Warburton – will be independent: “There is no pre-determined outcome.’’